Exhibit 10.5


 


NEITHER THESE SECURITIES REPRESENTED BY THIS
CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE
STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR (B) IF REASONABLY REQUESTED BY THE
COMPANY, AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY THAT
REGISTRATION IS NOT REQUIRED UNDER SAID ACT.


 


VYYO
INC.


 


WARRANT


 


	
  Warrant No. [   ]

  	
   

  	
  Dated: March 22, 2006

  



 


Vyyo Inc., a Delaware corporation (the “Company”), hereby certifies that, for value received, Goldman,
Sachs & Co., or its registered assigns (the “Holder”), is entitled to purchase from the
Company up to a total of 298,617 shares of common stock, $0.0001 par value per
share (the “Common Stock”), of the
Company (each such share, a “Warrant Share”
and all such shares, the “Warrant Shares”)
at an exercise price equal to $0.10 per share (as adjusted from time to time as
provided in Section 9, the “Exercise
Price”), at any time and from the date hereof and through and
including the date that is the earlier of five (5) years from the date of
issuance hereof and the closing of the sale of all or substantially all of the
Company’s assets or a merger or acquisition of the Company (the “Expiration Date”), and subject to the
following terms and conditions. This Warrant (this “Warrant”) is one of a series of similar warrants issued
pursuant to that certain Securities Purchase Agreement, dated as of the date
hereof, by and among the Company and the Investors identified therein (the “Securities Purchase Agreement”) and in
connection with the issuance of certain of the Company’s Senior Secured Notes. All
such warrants are referred to herein, collectively, as the “Warrants.”


 


1.                                       Definitions.
In addition to the terms defined elsewhere in this Warrant, capitalized terms
that are not otherwise defined herein have the meanings given to such terms in
the Securities Purchase Agreement.


 


2.                                       Registration
of Warrant. The Company shall register this Warrant, upon records to be
maintained by the Company for that purpose (the “Warrant Register”), in the name of the record Holder hereof
from time to time. The Company may deem and treat the registered Holder of
this Warrant as the absolute owner hereof for the purpose of any exercise
hereof or any distribution to the Holder, and for all other purposes, absent
actual notice to the contrary.


 


3.                                       Registration
of Transfers. The Company shall register the transfer of any portion of
this Warrant in the Warrant Register, upon surrender of this Warrant, with the Form of
Assignment attached hereto duly completed and signed, to the transfer agent or
to the Company at its address specified herein. Upon any such registration or
transfer, a new warrant to purchase Common Stock, in substantially the form of
this Warrant (any such new warrant, a “New


 

















 


Warrant”),
evidencing the portion of this Warrant so transferred shall be issued to the
transferee and a New Warrant evidencing the remaining portion of this Warrant
not so transferred, if any, shall be issued to the transferring Holder. The acceptance
of the New Warrant by the transferee thereof shall be deemed the acceptance by
such transferee of all of the rights and obligations of a holder of a Warrant.


 


4.                                       Exercise and
Duration of Warrants.


 


(a)                                  This Warrant shall be
exercisable by the registered Holder at any time and from time to time on or
after the date hereof to and including the Expiration Date. At 6:30 P.M.,
New York City time on the Expiration Date, the portion of this Warrant not
exercised prior thereto shall be and become void and of no value; provided
that, if on the Expiration Date, there is no effective Registration
Statement covering the resale of the Warrant Shares, then this Warrant shall be
deemed to have been exercised in full (to the extent not previously exercised)
on a “cashless exercise” basis at 6:30 P.M. New York City time on the
Expiration Date.


 


(b)                                 A Holder may exercise
this Warrant by delivering to the Company (i) an exercise notice, in the form attached
hereto (the “Exercise Notice”),
appropriately completed and duly signed along with the Warrant, and (ii) payment
of the Exercise Price for the number of Warrant Shares as to which this Warrant
is being exercised (which may take the form of a “cashless exercise”
if so indicated in the Exercise Notice only if a “cashless exercise” may occur
at such time pursuant to Section 10 below), and the date such items
are delivered to the Company (as determined in accordance with the notice
provisions hereof) is an “Exercise Date.”  Execution and delivery of the Exercise Notice
shall have the same effect as cancellation of the original Warrant and issuance
of a New Warrant evidencing the right to purchase the remaining number of
Warrant Shares.


 


5.                                       Delivery of
Warrant Shares.


 


(a)                                  Upon exercise of this Warrant,
the Company shall promptly issue or cause to be issued and cause to be
delivered to or upon the written order of the Holder a certificate for the
Warrant Shares issuable upon such exercise. The Company shall, upon request of
the Holder, use its commercially reasonable efforts to deliver Warrant Shares
hereunder electronically through the Depository Trust Corporation or another
established clearing corporation performing similar functions.


 


(b)                                 This Warrant is exercisable,
either in its entirety or, from time to time, for a portion of at least 10,000
Warrant Shares. Upon surrender of this Warrant following one or more partial
exercises, the Company shall issue or cause to be issued, at its expense, a New
Warrant evidencing the right to purchase the remaining number of Warrant Shares.


 


(c)                                  The Company’s obligations to
issue and deliver Warrant Shares in accordance with the terms hereof are
absolute and unconditional, irrespective of any action or inaction by the
Holder to enforce the same, any waiver or consent with respect to any provision
hereof, the recovery of any judgment against any Person or any action to
enforce the same, or any setoff, counterclaim, recoupment, limitation or
termination, or any breach or alleged breach by the Holder or any other Person
of any obligation to the Company or any violation or alleged


 


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violation of law by the Holder or any other
Person, and irrespective of any other circumstance which might otherwise limit
such obligation of the Company to the Holder in connection with the issuance of
Warrant Shares. Nothing herein shall limit a Holder’s right to pursue any other
remedies available to it hereunder, at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief with
respect to the Company’s failure to timely deliver certificates representing
shares of Common Stock upon exercise of the Warrant as required pursuant to the
terms hereof.


 


6.                                       Charges,
Taxes and Expenses. Initial issuance and delivery of certificates for
shares of Common Stock upon exercise of this Warrant shall be made without
charge to the Holder for any issue or transfer tax, withholding tax, transfer
agent fee or other incidental tax or expense in respect of the issuance of such
certificates, all of which taxes and expenses shall be paid by the Company;
provided, however, that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the registration of any
certificates for Warrant Shares or Warrants in a name other than that of the
Holder. The Holder shall be responsible for all other tax liability that may arise
as a result of holding or transferring this Warrant or receiving Warrant Shares
upon exercise hereof.


 


7.                                       Replacement
of Warrant. If this Warrant is mutilated, lost, stolen or destroyed, the
Company shall issue or cause to be issued in exchange and substitution for and
upon cancellation hereof, or in lieu of and substitution for this Warrant, a
New Warrant, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction and customary and reasonable bond or
indemnity, if requested. Applicants for a New Warrant under such circumstances
shall also comply with such other reasonable regulations and procedures and pay
such other reasonable third-party costs as the Company may prescribe.


 


8.                                       Reservation
of Warrant Shares. The Company covenants that it will at all times reserve
and keep available out of the aggregate of its authorized but unissued and
otherwise unreserved Common Stock, solely for the purpose of enabling it to
issue Warrant Shares upon exercise of this Warrant as herein provided, the
number of Warrant Shares which are then issuable and deliverable upon the
exercise of this entire Warrant, free from preemptive rights or any other
contingent purchase rights of persons other than the Holder (after giving
effect to the adjustments and restrictions of Section 9, if any). The
Company covenants that all Warrant Shares so issuable and deliverable shall,
upon issuance and the payment of the applicable Exercise Price in accordance
with the terms hereof, be duly and validly authorized, issued and fully paid
and nonassessable. The Company will
take all such action as may be necessary to assure that such shares of Common
Stock may be issued as provided herein without violation of any applicable
law or regulation, or of any requirements of any securities exchange or
automated quotation system upon which the Common Stock may be listed.


 


9.                                       Certain Adjustments.
The Exercise Price and number of Warrant Shares issuable upon exercise of this
Warrant are subject to adjustment from time to time as set forth in this Section 9.


 


(a)                                  Stock Dividends and Splits. If the Company, at any time
while this Warrant is outstanding, (i) pays a stock dividend on its Common
Stock or otherwise makes a distribution on any class of capital stock that
is payable in shares of Common Stock


 


3

















 


(ii) subdivides outstanding shares of
Common Stock into a larger number of shares or (iii) combines outstanding
shares of Common Stock into a smaller number of shares, then in each such case
the Exercise Price shall be multiplied by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding immediately before
such event and of which the denominator shall be the number of shares of Common
Stock outstanding immediately after such event. Any adjustment made pursuant to
clause (i) of this paragraph shall become effective immediately after the
record date for the determination of stockholders entitled to receive such
dividend or distribution, and any adjustment pursuant to clause (ii) or (iii) of
this paragraph shall become effective immediately after the effective date of
such subdivision or combination.


 


(b)                                 Calculations. All calculations under this Section 9
shall be made to the nearest cent or the nearest 1/100th of a share, as
applicable. The number of shares of Common Stock outstanding at any given time
shall not include shares owned or held by or for the account of the Company,
and the disposition of any such shares shall be considered an issue or sale of
Common Stock.


 


(c)                                  Notice of Adjustments. Upon the occurrence of each
adjustment pursuant to this Section 9, the Company at its expense
will promptly compute such adjustment in accordance with the terms of this
Warrant and prepare a certificate setting forth such adjustment, including a
statement of the adjusted Exercise Price and adjusted number or type of Warrant
Shares or other securities issuable upon exercise of this Warrant (as
applicable), describing the transactions giving rise to such adjustments and
showing in detail the facts upon which such adjustment is based. Upon written
request, the Company will promptly deliver a copy of each such certificate to
the Holder and to the Company’s transfer agent.


 


(d)                                 Notice of Corporate Events. If the Company (i) declares
a dividend or any other distribution of cash, securities or other property in
respect of its Common Stock, including without limitation any granting of
rights or warrants to subscribe for or purchase any capital stock of the
Company or any Subsidiary, (ii) authorizes or approves, enters into any
agreement contemplating or solicits stockholder approval for  (x) any sale of all or substantially all of
its assets in one or a series of related transactions, (y) any tender
offer or exchange offer (whether by the Company or another Person) pursuant to
which holders of Common Stock are permitted to tender or exchange their shares
for other securities, cash or property, or (z) any reclassification of the
Common Stock or any compulsory share exchange pursuant to which the Common
Stock is effectively converted into or exchanged for other securities, cash or
property or (iii) authorizes the voluntary dissolution, liquidation or
winding up of the affairs of the Company, then the Company shall deliver to the
Holder a notice describing the material terms and conditions of such
transaction, at least ten business days prior to the applicable record or
effective date on which a Person would need to hold Common Stock in order to
participate in or vote with respect to such transaction, and the Company will
take all steps reasonably necessary in order to insure that the Holder is given
the practical opportunity to exercise this Warrant prior to such time so as to
participate in or vote with respect to such transaction; provided, however,
that the failure to deliver such notice or any defect therein shall not affect
the validity of the corporate action required to be described in such notice.


 


10.                                 Payment of Exercise
Price. The Holder shall pay the Exercise Price in immediately available
funds; provided, however, that if at any time after the Required
Effective


 


4

















 


Date a Registration Statement covering the resale of the Warrant Shares
is not effective on the Exercise Date, the Holder may satisfy its
obligation to pay the Exercise Price through a “cashless exercise,” in which
event the Company shall issue to the Holder the number of Warrant Shares
determined as follows:


 


	
   

  	
   

  	
  X = Y [(A-B)/A]

  
	
  where:

  	
   

  	
   

  
	
   

  	
   

  	
  X = the number of Warrant Shares to be issued to the Holder.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Y = the number of Warrant Shares with respect to which this Warrant
  is being exercised.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  A = the average of the Closing Prices for the five Trading Days
  immediately prior to (but not including) the Exercise Date.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B = the Exercise Price.

  



 


For purposes of Rule 144 promulgated
under the Securities Act, it is intended, understood and acknowledged that the
Warrant Shares issued in a cashless exercise transaction shall be deemed to
have been acquired by the Holder, and the holding period for the Warrant Shares
shall be deemed to have commenced, on the date this Warrant was originally
issued pursuant to the Securities Purchase Agreement.


 


11.                                 Fractional Shares.
The Company shall not be required to issue or cause to be issued fractional
Warrant Shares on the exercise of this Warrant. If any fraction of a Warrant Share
would, except for the provisions of this Section, be issuable upon exercise of
this Warrant, the number of Warrant Shares to be issued will be rounded up to
the nearest whole share.


 


12.                                 Notices. Any
and all notices or other communications or deliveries hereunder (including
without limitation any Exercise Notice) shall be in writing and shall be deemed
given and effective on the earliest of (i) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
specified in the Securities Purchase Agreement prior to 6:30 p.m. (New
York City time) on a Trading Day, (ii) the next Trading Day after the date
of transmission, if such notice or communication is delivered via facsimile at
the facsimile number specified in the Securities Purchase Agreement on a day
that is not a Trading Day or later than 6:30 p.m. (New York City time) on
any Trading Day, (iii) the Trading Day following the date of mailing, if
sent by nationally recognized overnight courier service or (iv) upon
actual receipt by the party to whom such notice is required to be given. The
address for such notices or communications shall be as set forth in the
Securities Purchase Agreement.


 


13.                                 Registration Rights
Agreement. The Common Shares for which this Warrant is exercisable are
entitled to the benefits of a Registration Rights Agreement, dated as of the
date hereof, between the Company and the Holder and subject to the limitations
therein.


 


14.                                 Miscellaneous.


 


5

















 


(a)                                  Subject to the restrictions on
transfer set forth herein, this Warrant may be assigned by the Holder in
not less than 100,000 Warrant Shares. This Warrant may not be assigned by
the Company except to a successor in the event of a Fundamental Transaction. This
Warrant shall be binding on and inure to the benefit of the parties hereto and
their respective successors and assigns. Subject to the preceding sentences,
nothing in this Warrant shall be construed to give to any Person other than the
Company and the Holder any legal or equitable right, remedy or cause of action
under this Warrant. This Warrant may be amended only in writing signed by
the Company and the Holder and their successors and assigns.


 


(b)                                 The Company will not, by
amendment of its governing documents or through any reorganization, transfer of
assets, consolidation, merger, dissolution, issue or sale of securities or any
other voluntary action, avoid or seek to avoid the observance or performance of
any of the terms of this Warrant, but will at all times in good faith assist in
the carrying out of all such terms and in the taking of all such action as may be
reasonably necessary or appropriate in order to protect the rights of the
Holder against impairment. Without limiting the generality of the foregoing,
the Company (i) will not increase the par value of any Warrant Shares
above the amount payable therefor on such exercise, (ii) will take all
such action as may be reasonably necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable
Warrant Shares on the exercise of this Warrant, and (iii) will not close
its stockholder books or records in any manner which interferes with the timely
exercise of this Warrant.


 


(C)                                GOVERNING LAW; VENUE; WAIVER OF
JURY TRIAL. ALL
QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION
OF THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING REGARD TO ANY APPLICABLE
PRINCIPALS OF CONFLICTS OF LAW. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE
EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF
NEW YORK, BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER
OR IN CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR
DISCUSSED HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE
TRANSACTION DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT
IN ANY SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT
TO THE JURISDICTION OF ANY SUCH COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES
TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD
AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN
SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER
PERMITTED BY LAW. THE COMPANY HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY.


 


6

















 


(d)                                 The headings herein are for
convenience only, do not constitute a part of this Warrant and shall not
be deemed to limit or affect any of the provisions hereof.


 


(e)                                  In case any one or more of the
provisions of this Warrant shall be invalid or unenforceable in any respect,
the validity and enforceability of the remaining terms and provisions of this
Warrant shall not in any way be affected or impaired thereby and the parties
will attempt in good faith to agree upon a valid and enforceable provision
which shall be a commercially reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Warrant.


 


[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK,

SIGNATURE PAGE FOLLOWS]


 


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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed by its authorized officer as of the date first indicated above.


 


	
   

  	
  VYYO INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						



 

















 


FORM OF
EXERCISE NOTICE


 


[To be executed by the Holder to exercise the right to purchase shares
of Common Stock under the foregoing Warrant]


 


To:  VYYO INC.


 


The undersigned is the Holder of Warrant No.       
(the “Warrant”) issued by Vyyo
Inc., a Delaware corporation (the “Company”).
Capitalized terms used herein and not otherwise defined have the respective
meanings set forth in the Warrant.


 


1.                                       The
Warrant is currently exercisable to purchase a total of               
Warrant Shares.


 


2.                                       The
undersigned Holder hereby exercises its right to purchase                  
Warrant Shares pursuant to the Warrant.


 


3.                                       The
Holder intends that payment of the Exercise Price shall be made as (check one):


 


o                                    “Cash Exercise”
under Section 10


 


o                                    “Cashless Exercise”
under Section 10


 


4.                                       If
the holder has elected a Cash Exercise, the holder shall pay the sum of $            
to the Company in accordance with the terms of the Warrant.


 


5.                                       Pursuant
to this exercise, the Company shall deliver to the holder              
Warrant Shares in accordance with the terms of the Warrant.


 


6.                                       Following
this exercise, the Warrant shall be exercisable to purchase a total of              
Warrant Shares.


 


	
  Dated:            ,     

  	
  Name of Holder:

  
	
   

  	
   

  
	
   

  	
  (Print)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  (Signature must conform in all respects to

  name of holder as specified on the face of the

  Warrant)

  
							



 

















 


FORM OF
ASSIGNMENT


 


[To be completed and signed only upon transfer of Warrant]


 


FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto                                         
the right represented by the within Warrant to purchase                
shares of Common Stock of Vyyo Inc. to which the within Warrant relates and
appoints                     
attorney to transfer said right on the books of Vyyo Inc. with full power of
substitution in the premises.


 


 


	
  Dated:           ,     

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Signature must conform in all respects to name of holder

  as specified on the face of the Warrant)

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address of Transferee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  In the presence of: